Austrian economists talk a lot about “time preference,” the willingness for people to wait before they are paid income, capital gains, interest or dividends.
Whether you are a student, business person, investor or consumer, waiting is a fact of life — it takes time to earn a degree, make money in a business, take profits on an investment or have enough money to retire.
Today more than ever, the two most common words I hear are “Please wait.”
We arrive early at the airport to get our ticket and then have to wait in line to go through government security. If the flight is delayed, we may have to wait for a couple of hours before flying. At the end of the flight, the flight attendant will inevitably say, “Thank you for your patience.”
Waiting on the telephone is inevitable. “Please wait” is the first phrase I hear when calling a company or the government. My son recently waited 15 hours for a real person from the IRS to answer the agency’s 800 number. But it’s not just the government. It is also private companies. Every time I call my bank message center to find out my balance or if a check has cleared, at some point the voice will say “please wait.”
One time I didn’t even have to wait in a store for something, and the clerk said almost automatically, “Thanks for your patience.”
Private enterprise is more keenly aware of the customers’ need for speed and will usually act quickly if customers start waiting in line at a grocery store or a bookstore. Sadly, the same can’t be said about the U.S. Post Office, the Department of Motor Vehicles, the Transportation Security Administration, the IRS or other government agencies. You can count on hearing the two most common words, “Please wait.” And wait, and wait.
There is a natural tendency for private enterprise to increase services and for government agencies to reduce them. Perhaps privatization is the answer. Waiting may not be eliminated (it still exists in the private sector), but it might be minimized.
Investors have to be patient in the marketplace.Jack Bogle, the founder of the Vanguard Group, emphasizes the need to be patient. “Time is your friend,” Bogle said. “Impulse is your enemy.” Many a sound company has seen its stock price fall in the short term but recover in the long run and move to a record price. Don’t panic, and you’ll be rewarded.J. Paul Getty, America’s first billionaire, said it best: “The big profits go to the intelligent, careful and patient investor, not to the reckless and overeager speculator.”
In case you missed it, I encourage you to read my e-letter column from last week abouthow to avoid the most dangerous investment strategy.